The United States Internal Revenue Service (IRS) has officially classified decentralized finance (DeFi) front-end platforms as “brokers” under new tax reporting guidelines. This change, slated to take effect in 2027, obligates these platforms to disclose gross proceeds from sales involving cryptocurrencies and digital assets, as well as information on the taxpayers involved. While the regulations do not apply to all DeFi applications, they do target those front-end services that facilitate cryptocurrency transactions.
In other developments, Kyrgyzstan reported a decline of over 50% in cryptocurrency mining tax revenue for 2024, generating $535,000 (46.6 million soms), compared to 93.7 million soms in 2023. This drop comes despite the increased market value of cryptocurrencies during the year.
Meanwhile, U.S. Bitcoin exchange-traded funds (ETFs) experienced a rebound with net inflows totaling $475.2 million on December 26 after a four-day outflow period. The Fidelity Wise Origin Bitcoin Fund led the surge with $254.4 million in inflows, followed by the ARK 21Shares Bitcoin ETF and the iShares Bitcoin Trust ETF with $186.9 million and $56.5 million, respectively. This reversal followed total outflows of $1.52 billion between December 19 and December 24, with markets closed on December 25.
